New EU VAT Exemption Framework Introduced for Small Businesses Active in Greece
A revised EU wide VAT exemption regime is being implemented for small businesses established in other member states but conducting transactions in Greece.
A turnover ceiling of 100000 euros across the EU and a separate limit of 10000 euros within Greece define who qualifies for the exemption.
A decision issued by AADE Governor Giorgos Pitsilis sets out the procedural steps, conditions of eligibility, competent authorities and rules on when the exemption ends.
New Designated Authority for Managing the Special Regime
The Autonomous Section H Special Regime for Small Businesses of KEFODE Attica is assigned responsibility for handling applications and serving as the liaison between Greece and other EU tax administrations.
Applicants must declare their intention to use the regime both in their home country and in Greece before benefiting from the exemption.
Eligibility Requirements and Key Thresholds
Businesses based in another EU member state may join the regime after notifying their domestic tax authority and expressing their intention to apply the exemption in Greece.
Qualification depends on respecting both turnover thresholds during the current and previous calendar year to maintain exempt status.
Exceeding either the EU wide 100000 euro limit or the Greek 10000 euro limit results in the automatic loss of eligibility.
Procedures for Ending the Exemption
Termination of participation may occur voluntarily when a business requests deregistration through its home country’s tax authority.
Mandatory termination is triggered when a member state informs AADE that the conditions are no longer met or if turnover breaches are identified.
Retroactive exclusion can apply in cases where evidence shows that eligibility criteria were not satisfied from the outset.
Additional Grounds for Termination and Return to Prior VAT Status
Ending the exemption may also follow cessation of business activity or outcomes of systemic checks conducted by the tax administration.
Reassignment to a previous VAT regime is foreseen when a business already held a Greek VAT number before entering the special framework.
Implementation Timeline and Practical Example
The updated regime becomes effective on 1 January 2025 for taxable entities that are not established in Greece.
An EU based business already benefiting from a small business exemption domestically can request to apply the same treatment in Greece through its national tax administration.
The request is forwarded to AADE together with transaction data covering both total EU wide activity and activity within Greece.
Losing entitlement for the remaining year occurs automatically once the 100000 euro EU turnover threshold is surpassed.
